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EXTON, Pa., March 8 /PRNewswire/ -- Intelligent Electronics Inc. (Nasdaq-NNM: INEL)) announced today that it has adopted a Shareholders Rights Plan and has declared a distribution of one Right for each outstanding share of Company Common Stock to shareholders of record at the close of business on March 25, 1996, and for each share of Company Common Stock issued by the Company thereafter and prior to the subsequent distribution date of the Rights. Prior to such subsequent distribution date, the Rights will trade with the Company Common Stock.

The Rights Plan was not adopted in response to any specific effort to acquire control of the Company. Richard D. Sanford, Chairman and Chief Executive Officer of the Company, stated that "The Rights Plan is not intended to and will not prevent a takeover of the Company. The Rights, however, may cause substantial dilution to a potential acquiror unless the Rights are first redeemed by the Board of Directors of the Company. Nevertheless, the Rights should not interfere with a transaction that the Board of Directors determines is in the best interests of the Company and its shareholders. The Rights Plan does not weaken the financial strength or interfere with the Company's business plans, and the issuance of the Rights has no dilutive effect, will not affect reported per share results, and will not affect the way the Company Common Stock is traded."

Each Right entitles the registered holder, subject to the terms of a Rights Agreement, to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock (a "Unit") at a Purchase Price of $28.00 per Unit, subject to adjustment. The Rights are not exercisable until the subsequent distribution date and will expire at the close of business on the tenth anniversary of the Rights Agreement unless earlier redeemed by the Company as described below. After subsequent distribution, the Rights may be redeemed by action of the Company's independent directors for $.001 per Right.

As soon as practicable after the distribution date, Rights Certificates will be mailed to holders of record of Company Common Stock as of the close of business on the distribution date and, thereafter, the separate Rights Certificates alone will represent the Rights.

The threshold for triggering subsequent distribution of the rights is 10 days following the acquisition of 15% or more of the outstanding Company Common Stock by a non-exempt person, or 10 days following commencement of an offer to acquire 15% or more of the outstanding Company Common Stock.

In the event that (i) the Company is the surviving corporation in a merger with an acquiring person and shares of Company Common Stock remain outstanding , (ii) a person becomes the beneficial owner of 15% or more of the then outstanding shares of Company Common Stock, (iii) an acquiring person engages in one or more "self-dealing" transactions as set forth in the Rights Agreement, or (iv) during such time as there is an acquiring person, an event occurs which results in such acquiring person's ownership interest being increased by more than 1% (e.g., by means of a reverse stock split or recapitalization), then, in each such case, each holder of a Right will thereafter have the right to receive, upon exercise, Units of Preferred Stock (or, in certain circumstances, Company Common Stock, cash, property or other securities of the Company) having a then current market value equal to two times the exercise price of the Right. Notwithstanding any of the foregoing, following the occurrence of any of the events set forth in this paragraph, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by any acquiring person will be null and void.

In the event that, at any time following the date when a person becomes an acquiring person (the "Stock Acquisition Date"), (i) the Company is acquired in a merger or other business combination transaction and the Company is not the surviving corporation (other than a merger described in the preceding paragraph), (ii) any person consolidates or merges with the Company and all or part of the Company Common Stock is converted or exchanged for securities, cash or property of any other person or (iii) 50% or more of the Company's assets or earning power is sold or transferred, each holder of a Right (except Rights which previously have been voided as described above) shall thereafter have the right to receive, upon exercise, common stock of the acquiring person having a then urrent market value equal to two times the exercise price of the Right.

At any time until ten business days following the Stock Acquisition Date, a majority of the independent directors of the Company may redeem the Rights in whole, but not in part, at a price of $.001 per Right (subject to adjustment in certain events) (the "Redemption Price"), payable, at the election of such majority of the independent directors, in cash or shares of Company Common Stock.

Until a right is exercised, the holder thereof, as such, will have no rights as a shareholder of the Company, including, without limitation, the right to vote or to receive dividends. While the distribution of the Rights will not be taxable to shareholders or to the Company, shareholders may, depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for Units of Preferred Stock (or other consideration).

Intelligent Electronics is a leader in providing information technology products, services and solutions to an ever-widening spectrum of customers, including the "Fortune 1000," governmental agencies, small and home offices, educational institutions and others using technology to create efficiency. Intelligent Electronics specializes in delivering access to tomorrow's technology today.

 -0- 3/8/96

/CONTACT: Kathleen Mayo, VP-Investor Relations of Intelligent Electronics, 610-458-6668/


CO: Intelligent Electronics, Inc. ST: Pennsylvania IN: REA CPR SU:

MK-TD -- PHF020 -- 1731 03/08/96 17:01 EST
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Publication:PR Newswire
Date:Mar 8, 1996

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